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3 Stock Picks for a Long-Term Investment Approach

These companies have consistently increased sales and Ebitda

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Mar 23, 2022
Summary
  • IQVIA Holdings Inc., Copart Inc. and Westlake Chemical Corp have highly predictable businesses.
  • They have grown revenue and Ebitda steadily over the past years, resulting in strong share price performances.
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The GuruFocus business predictability rating ranks companies on a five-star scale, defining the more predictable companies as businesses whose revenue per share and Ebitda per share (or book value per share in the case of financial stocks) have been growing steadily and who have produced a strong long-term performance of their stock prices.

Thus, those following a long-term investment strategy could find attractive investing opportunities by screening the market for stocks that have a high GuruFocus business predictability rating, in my opinion. The following stocks all trade with high business predictability ratings and are recommended by Wall Street.

IQVIA Holdings Inc.

The first company that meets the criteria is IQVIA Holdings Inc. (

IQV, Financial). Based in Danbury, Connecticut, the company is a supplier of advanced analytics, technology solutions and clinical research services to pharmaceutical, biotechnology, device and diagnostic and consumer health companies in North America and internationally.

IQVIA Holdings Inc.'s business has a four-and-a-half-star business predictability rank from GuruFocus. The company saw its revenue per share increase by 6.30% and its Ebitda per share increase by 15.10% on average every year over the past 10 years.

The share price ($224.27 as of early trading on Wednesday) has grown astonishingly over the past 10 years, determining a market capitalization of $42.81 billion.

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GuruFocus assigned a financial strength rating of 4 out of 10 and a profitability rating of 9 out of 10 to the company.

The price-earnings ratio is 45.21 versus the industry median of 23.01, the enterprise-value-to-Ebitda ratio is 19.43 versus the industry median of 16.29 and the price-sales ratio is 3.15 versus the industry median of 3.86.

Wall Street sell-side analysts recommend a median rating of buy for this stock and have established an average target price of about $282.65 per share.

Copart Inc.

The second company that meets the criteria is Copart Inc. (

CPRT, Financial), a Dallas, Texas-based online provider of auctions and vehicle remarketing services to its clients in North America and internationally.

Copart Inc.'s business has a four-star business predictability rank from GuruFocus. The company saw its revenue per share increase by 13.9% and its Ebitda per share increase by 17% on average every year over the past 10 years.

The current stock price ($126 per share as of early trading on Wednesday) has grown like crazy over the past 10 years to a market capitalization of $29.94 billion.

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GuruFocus assigned a financial strength rating of 9 out of 10 and a profitability rating of 10 out of 10 to the company.

The price-earnings ratio is 27.87 versus the industry median of 16.06, the enterprise-value-to-Ebitda ratio is 20.24 versus the industry median of 8.92 and the price-sales ratio is 9.6 versus the industry median of 0.79.

Wall Street sell-side analysts recommend a median rating of buy for the stock with an average target price of $168.75 per share.

Westlake Chemical Corp

The third company that meets the criteria is Westlake Chemical Corp. (

WLK, Financial), a Houston, Texas-based specialty chemicals company.

Westlake Chemical Corp.'s business has a four-star business predictability rank from GuruFocus. The company saw its revenue per share increase by 13.20% and its Ebitda per share increase by 13.20% on average every year over the past 10 years.

The current share price ($125.75 as of early trading on Wednesday) has increased exponentially over the past 10 years, determining a market capitalization of $16.12 billion.

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GuruFocus assigned a financial strength rating of 6 out of 10 and a profitability rating of 9 out of 10 to the company.

The price-earnings ratio is 8.1 versus the industry median of 18.05, the enterprise-value-to-Ebitda ratio is 5.37 versus the industry median of 11.42 and the price-sales ratio is 1.37 versus the industry median of 1.58.

Wall Street sell-side analysts recommend a median rating of overweight for the stock with an average target price of $125.25 per share.

Disclosures

I/we have no positions in any stocks mentioned, and have no plans to buy any new positions in the stocks mentioned within the next 72 hours. Click for the complete disclosure
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